LONDON, Aug. 3, 2004 (PRIMEZONE) -- Enodis PLC (NYSE:ENO):
MOMENTUM IN NORTH AMERICAN FOOD SERVICE EQUIPMENT
GBPm (except EPS)
Q304 Q303 YTD04 YTD03
Turnover 166.9 171.7 457.7 482.6
Operating profit 12.5 11.9 26.3 18.6
Adjusted operating 15.5 16.5 35.3 36.0
profit*
Profit before tax 8.5 6.7 15.7 4.7
Adjusted profit before 11.5 11.3 22.5 19.6
tax**
Basic and diluted 1.6 1.2 3.0 0.4
earnings per share
(pence)
Adjusted basic and 2.4 2.4 4.6 4.1
diluted earnings per
share (pence)**
Net debt (118.8) (174.0)
Like-for-like Food 166.1 156.8 456.6 447.1
Equipment turnover***
Like-for-like Food 18.5 16.9 43.6 38.8
Equipment operating
profit***
Highlights
-- Adjusted Group profit before tax YTD up 15% despite adverse
foreign exchange movements of GBP2.3m
-- Food Equipment like-for-like operating profit YTD up 12% and Q304
up 9% driven by improving conditions in North American Food Service
Equipment markets which offset the impact of difficult markets in
Europe and Food Retail
-- Profit before tax YTD up GBP11.0m and Q304 up GBP1.8m
-- Basic and diluted EPS YTD 3.0p versus 0.4p last year
-- Continued reduction in net debt
* Before operating exceptional items and goodwill amortisation
(see Other unaudited financial information in the attached
financial statements for more details).
** Before all exceptional items and goodwill amortisation (see
Other unaudited financial information in the attached financial
statements for details).
*** Prior year turnover and adjusted operating profit adjusted
for foreign exchange (see Other unaudited financial information
in the attached financial statements for details).
The above adjusted information is used throughout this document and is presented to indicate underlying operating performance of the Group.
Dave McCulloch, Chief Executive Officer, said:
"I am pleased with the quarter's strong overall results. Our North American Food Service Equipment business more than doubled its turnover growth rate of 4% in Q2 to 9% in Q3, leading to an 18% improvement in like-for-like operating profits in the quarter. In both our European Food Service and Food Retail Equipment businesses progress was slowed by difficult markets and the inability to pass on all materials inflation which resulted in a slight decline in operating profits from last year.
"It is clear that North American restaurant operators now have the confidence to increase investment levels in equipment. Furthermore, our family of accelerated cooking systems and food preparation stations is attracting significant interest from a number of major chains."
A conference call for equity investors and analysts will be held today at 9.00am. We will also host a conference call for bondholders and US investors at 4.00pm today. The format of these calls will be a brief resume of the quarterly results and a Q&A session. For details, please contact Elaine Holder at Financial Dynamics on +44 (0) 20 7269 7121, or Tina Mularski at Enodis on +44 (0) 20 7304 6006.
SEC Filings
Enodis plc has a secondary listing on the New York Stock Exchange (Ticker symbol: ENO) and furnishes reports with the Securities and Exchange Commission (SEC) in the US. These reports contain additional information that is not included in this press release. Copies of the reports are available on the SEC website at www.sec.gov.
This press release contains "forward-looking statements," within the meaning of the U.S. federal securities laws, that represent our expectations or beliefs regarding future events, based on currently available information, including statements concerning our anticipated performance. These statements by their nature involve risks and uncertainties, many of which are beyond our control. Our actual results could differ materially from those expressed in the forward-looking statements due to a variety of important factors, including our substantial debt obligations and restrictive covenants; susceptibility to economic downturns including delays on market improvements; competitive pricing pressures; consolidation or loss of large customers; changes in customer purchasing patterns; unfavorable changes in the price of commodities or raw materials; the results of technological developments; currency fluctuations; the outcome of current lawsuits; recognition of deferred tax assets; and other risks related to our U.S., U.K. and foreign operations. A more complete description of our risk factors is included under "Risk Factors" in our Form 20-F which was filed with the SEC during December 2003, as well as in more recent Form 6-K reports furnished with the SEC.
CHIEF EXECUTIVE OFFICER'S REVIEW
Results
Q304 Group turnover was GBP166.9m (Q303: GBP171.7m). Like-for-like Food Equipment turnover in the quarter was up 6% (GBP9.3m) at GBP166.1m as last quarter's improvements have accelerated. This increase has been more than offset in actual Group turnover by the translation effect of foreign currency exchange rate movements, principally the weaker US dollar, of GBP14.9m.
YTD Group turnover was GBP457.7m (YTD03: GBP482.6m). Like-for-like Food Equipment turnover was up 2% to GBP456.6m YTD but this GBP9.5m increase was also more than offset in actual Group turnover by the translation effect of foreign currency exchange rate movements of GBP35.5m.
Q304 adjusted operating profit was GBP15.5m (Q303: GBP16.5m). Food Equipment like-for-like operating profit in the quarter was up GBP1.6m (9%) to GBP18.5m which broadly offset the GBP1.7m of currency effects. Food Service Equipment -- North America like-for-like operating profit was up 18% with strong performances at our ice, refrigeration and fryer businesses. We are benefiting from: an improved economy; pent up demand for replacement equipment; penetration of several new products; and our efforts, over the last three years, to form a selective distribution programme involving consolidation of our US sales force, dealer and service network.
YTD adjusted operating profit was GBP35.3m (YTD03: GBP36.0m). Like-for-like YTD Food Equipment operating profit was up GBP4.8m (12%) to GBP43.6m although this has been partially offset by foreign currency translation effects (GBP3.4m in YTD). Food Service Equipment -- North America like-for-like operating profit was up GBP4.2m (14%) to GBP34.4m. This more than offset lower European operating profits where unfavourable comparative figures resulted in part from the prior year profits from a major chain rollout that was not repeated in the current year. In addition, there has been increased current year product development spend and weak markets in the UK and continental Europe. The actions taken in early 2003 at Kysor Warren continued to be reflected in improved results in our Food Retail segment although the quarter on quarter comparative benefit has diminished and, as in Food Service Equipment, we saw substantially increased materials costs.
YTD adjusted profit before tax increased by 15% to GBP22.5m (YTD03: GBP19.6m) with adjusted operating profit GBP0.7m lower and interest GBP3.6m lower than the prior year. Adjusted profit before tax for the quarter was GBP11.5m (Q303: GBP11.3m) with adjusted operating profit GBP1.0m lower than last year, offset by a GBP1.2m lower interest charge.
YTD profit after tax improved by GBP10.4m to GBP11.8m, the result of improved operating profits, positive exceptional items and reduced interest costs. Profit after tax in the quarter was improved by GBP1.7m (35%) to GBP6.5m.
Net debt fell by GBP20.9m (15%) to GBP118.8m from GBP139.7m at 27 September 2003 with GBP11.1m of the decrease arising from favourable foreign exchange rate movements and the balance of GBP9.8m from our net cash flow which included capital expenditure of GBP8.0m as we have continued to invest in ERP systems. Compared to YTD03, net debt was down GBP55.2m (32%) at period end.
REVIEW OF OPERATIONS
Global Food Service Equipment
Global Food Service Equipment comprises our operations in North America, which contribute approximately 75% of Global Food Service Equipment annual turnover, and those in Europe/Asia.
Like-for-like turnover in the quarter improved by 8% compared to Q303, driven by Food Service Equipment North America, as our North American businesses continued to increase quarter on quarter sales. Adverse foreign currency translation effects of GBP11.7m offset this like-for-like improvement with turnover reducing by GBP1.8m (1%) to GBP140.1m. The increased like-for-like turnover contributed to an 11% increase in like-for-like operating profit compared to Q303 which offset the adverse foreign currency translation effects of GBP1.5m.
YTD04 turnover was GBP17.0m lower compared to YTD03 as a like-for-like increase of GBP10.7m (3%) was offset by the translation effect of foreign currency exchange rate movements, principally the weakening US dollar, of GBP27.7m. The increased like-for-like turnover contributed to a GBP2.3m (6%) increase in like-for-like operating profit which almost offset the adverse foreign currency translation effects of GBP3.2m.
Turnover GBPm YTD04 YTD03 FX Like-for-Like
YTD03
Food Service 280.4 299.4 (28.2) 271.2
Equipment -- North
America
Food Service 106.7 104.7 0.5 105.2
Equipment --
Europe/Asia
Global Food Service 387.1 404.1 (27.7) 376.4
Equipment
Food Service Equipment -- North America like-for-like turnover in Q304 was up 9% compared to Q303, as the like-for-like improvements shown last quarter have continued, and up 3% compared to YTD03. Improving growth in North America is a combination of factors: an improved economy; increased confidence of restaurant operators (particularly large chains); pent-up demand for replacement equipment; the benefits of Enodis selective distribution programmes and penetration of several new products. We saw strong performances at a number of our businesses including our ice, refrigeration and fryer operations and we increased turnover in most product lines.
We are particularly optimistic about the potential of several of our accelerated cooking systems which, when combined with our cold preparation systems, provide food stations which are attracting significant interest from a number of major chains.
Food Service Equipment -- Europe/Asia like-for-like turnover YTD increased by 1% as a 4% increase in Q304 started to improve the H104 breakeven position. The impact of difficult markets in the UK and continental Europe was offset by strong performances in our ice and beverage businesses.
Adjusted operating YTD04 YTD03 FX Like-for-Like profit GBPm YTD03 Food Service 34.4 33.4 (3.2) 30.2 Equipment -- North America Food Service 5.0 6.9 -- 6.9 Equipment -- Europe/Asia Global Food Service 39.4 40.3 (3.2) 37.1 Equipment
Food Service Equipment -- North America like-for-like operating profit was up 18% in Q304 and 14% in YTD04. In Q304, our ice, refrigeration and fryer businesses have continued their strong year on year performances. The YTD year on year improvement in like-for-like operating profit arose from the combined effect of increased sales in most product lines and last year's division-wide cost reduction programme.
As previously highlighted there have been significant commodity cost pressures, in particular steel surcharges. We have continued to mitigate these pressures through continued focus on our lean manufacturing and purchasing initiatives. In May 2004 we announced an additional price increase, effective 1 July 2004, which should complement our cost reduction initiatives and relieve more of the commodity cost pressures.
In Food Service Equipment -- Europe/Asia, similar factors affected both the YTD and Q304 as like-for-like operating profit improvements in our ice businesses have been more than offset by increased product development costs in continental Europe and difficult trading conditions, particularly in the UK and continental Europe. Last year's YTD comparative figures benefited from the contribution in the UK from a rollout of Merrychef ovens to a North American chain, not repeated this year. We are reviewing our options in Europe to improve efficiency.
Food Retail Equipment
Our Food Retail Equipment businesses operate predominantly in the USA with sales/service offices in Canada and Mexico.
GBPm YTD04 YTD03 FX Like-for-Like
YTD03
Turnover 69.5 78.5 (7.8) 70.7
Adjusted operating 4.2 1.9 (0.2) 1.7
profit
Kysor Warren has continued the progress shown in H104 and made small adjusted operating profit contributions in both YTD04 and Q304. The quarter on quarter comparative benefits of management actions started early in FY03 have diminished and, as in Food Service Equipment -- North America, we are seeing increasing material costs. Operationally, Kysor Warren is now on a stable footing and we are now attacking the challenges of a difficult market in which our existing US supermarket customer base faces strong pressure from its competitors. We believe that we have broadly maintained our market share and we are targeting new business. However, many of our customers tend to award contracts for two to three year periods so renewals are infrequent. Generally the market is extremely tough with competitive pricing needed to both retain and win new business, adding to the difficulty of passing on increased commodity costs through price increases.
Food Retail Equipment like-for-like turnover was down 2% in YTD04, compared to YTD03 as a result of the market conditions described in the previous paragraph affecting Kysor Warren's current supermarket customer base. This has offset improved turnover at Kysor Panel Systems and the benefits, particularly in Q204 and Q304, of new business in Mexico. Q304 like-for-like turnover was also down by 2% compared to Q303.
In YTD04, in addition to the operating profit effect of increased turnover at both Kysor Panel Systems and in Mexico, Kysor Warren continued its trend of improved results and was profitable compared to a like-for-like loss reported last year. Food Retail Equipment benefited from accrual releases arising from the satisfactory settlement of an outstanding legal claim in Q304. At GBP1.8m, like-for-like operating profit was flat in Q304 compared to Q303 as the quarter on quarter comparative effect of improvements at Kysor Warren has diminished.
OTHER
Exceptional items
The exceptional item in YTD04 relates to the release of disposal warranty accruals in H104 that are no longer required following the expiry of the associated warranty periods. There is no cash impact of this release.
Interest
The year to date interest charge was reduced by GBP3.6m (22%) to GBP12.8m. This is primarily the result of lower average debt balances.
Property
As discussed in our 2003 full year statement, we expect annual profits from property development to reduce over time. The GBP0.8m charge in the quarter related to the ongoing costs of managing our residual property portfolio and the phasing of costs relating to development projects and surplus leasehold properties. We have exchanged contracts for the sale of a further piece of our Felsted development and expect this to complete during Q404.
Litigation
The Bankruptcy Court for the Northern District of Indiana in the last few days handed down a judgment in the case of Consolidated Industries, a former subsidiary of the Enodis Group which commenced bankruptcy proceedings in 1998 after being sold by Enodis. This litigation was reported as a contingent liability in previous Enodis annual statements and a contingent liability note is also included as note 8 in the attached financial statements.
The court has ruled that Enodis should pay $43m (GBP24m) to the bankruptcy trustee. Enodis has been advised by its external legal counsel that the legal bases for the ruling and an earlier adverse judgment in Q103 for $8.6m (GBP4.7m), disclosed in our 2003 Annual Report, are in error and should be reversed on appeal. Having considered the advice from external legal counsel, we plan to file an appeal against both judgments. As a result of the Court's decision, we will be reassessing our strategy in these cases and hence our provisions for legal fees and expenses.
Tax
We benefit from the effect of brought forward US tax losses in minimising cash taxes and currently pay below 20% of our profits before tax, goodwill amortisation and exceptional items in taxes. This rate should continue for a number of years. We are in the process of finalising our long range business plan which will reflect our expected recovery in our North American business and associated tax planning strategies. This review may result in the recognition of an additional deferred tax asset relating to our US tax losses in Q404 which would have an impact on our tax charge for the period.
Earnings per share
YTD adjusted diluted earnings per share were 4.6p (YTD03: 4.1p). Basic earnings per share were 3.0p (YTD03: 0.4p).
Dividends
No dividend is proposed for the period (2003: nil).
OUTLOOK
We expect the strong recovery of our North American Food Service Equipment business to continue to be underpinned by the improved economy, pent up demand for replacement equipment, the benefits of Enodis selective distribution programmes and penetration of new products.
We are particularly optimistic about the potential for our accelerated cooking systems and food preparation stations which are attracting significant interest from a number of major chains.
We continue to see significant materials cost pressures, in particular steel surcharges. We continue to mitigate these pressures through our Group-wide lean manufacturing and purchasing initiatives, and on 1 July 2004 we implemented an additional price increase which should complement these initiatives.
In Europe, we expect the difficult market conditions to continue and therefore we have less ability than in the U.S. to pass on price increases to mitigate materials inflation. Increased investment in product development will not show benefits until 2005.
We expect the Food Retail Equipment sector to remain very challenging. We are focused on expanding our customer base in the USA, Canada and Mexico, along with a determined emphasis on product costs. However, the increased materials costs, pricing pressures and intense competition mean that it will take some time for our strategy to bear fruit.
Overall, our expectation of the Group's underlying performance for the 53 weeks ending 2 October 2004 has not changed since the time of our full year statement in November 2003.
Dave McCulloch
Chief Executive Officer
3 August 2004
Group profit and loss account
39 weeks to 26 June 2004 (YTD)
39 weeks to 26 June 2004
Before Exceptional Total
exceptional items
items (note 4)
Notes GBPm GBPm GBPm
(unaudited) (unaudited) (unaudited)
Turnover
Food 456.6 -- 456.6
Equipment
Property 1.1 -- 1.1
Total 2 457.7 -- 457.7
turnover
Operating
profit/(loss)
before
goodwill
amortisation
Food 43.6 -- 43.6
Equipment
Property (1.7) -- (1.7)
Corporate (6.6) -- (6.6)
costs
35.3 -- 35.3
Goodwill (9.0) -- (9.0)
amortisation
Operating 3 26.3 26.3
profit/(loss)
Profit/(loss) 4 -- 2.2 2.2
on disposal
of businesses
Profit/(loss) 26.3 2.2 28.5
on ordinary
activities
before
interest and
taxation
Net interest (12.8) -- (12.8)
payable and
similar
charges
Profit/(loss) 13.5 2.2 15.7
on ordinary
activities
before
taxation
Tax on 5 (3.9) -- (3.9)
profit/(loss)
on ordinary
activities
Profit/(loss) 9.6 2.2 11.8
on ordinary
activities
after
taxation
Equity (0.1) -- (0.1)
minority
interests
Retained 9.5 2.2 11.7
profit/(loss)
Earnings/(loss) 6 Pence
per share
(pence)
(unaudited)
Basic 3.0
earnings/(loss)
per share
Adjusted 4.6
basic
earnings/(loss)
per share
Diluted 3.0
earnings/(loss)
per share
Adjusted 4.6
diluted
earnings/(loss)
per share
39 weeks to 28 June 2003
Before Exceptional
exceptional items
items (note 4) Total
Notes GBPm GBPm GBPm
(unaudited) (unaudited) (unaudited)
Turnover
Food Equipment 482.6 -- 482.6
Property -- -- --
Total turnover 2 482.6 -- 482.6
Operating
profit/(loss)
before
goodwill
amortisation
Food Equipment 42.2 (1.9) 40.3
Property -- (2.5) (2.5)
Corporate (6.2) (2.8) (9.0)
costs
36.0 (7.2) 28.8
Goodwill (10.2) -- (10.2)
amortisation
Operating 3 25.8 (7.2) 18.6
profit/(loss)
Profit/(loss) 4 -- 2.5 2.5
on disposal of
businesses
Profit/(loss) 25.8 (4.7) 21.1
on ordinary
activities
before
interest and
taxation
Net interest (16.4) -- (16.4)
payable and
similar
charges
Profit/(loss) 9.4 (4.7) 4.7
on ordinary
activities
before
taxation
Tax on 5 (3.3) -- (3.3)
profit/(loss)
on ordinary
activities
Profit/(loss) 6.1 (4.7) 1.4
on ordinary
activities
after taxation
Equity -- -- --
minority
interests
Retained 6.1 (4.7) 1.4
profit/(loss)
Earnings/(loss) 6 Pence
per share
(pence)
(unaudited)
Basic 0.4
earnings/(loss)
per share
Adjusted basic 4.1
earnings/(loss)
per share
Diluted 0.4
earnings/(loss)
per share
Adjusted 4.1
diluted
earnings/(loss)
per share
Group statement 39 weeks to 39 weeks to
of total 26 June 28 March
recognised gains 2004 2003
and losses GBPm GBPm
(unaudited) (unaudited)
Retained 11.7 1.4
profit/(loss)
Currency translation
differences on foreign (11.7) (3.9)
currency net investments
Total recognised -- (2.5)
gains and losses
for the period
Prior period 1.4 --
adjustment (note 1)
Total recognised
gains and losses 1.4 (2.5)
since last
annual report
Group profit and loss account
13 weeks to 26 June 2004 (Third Quarter)
13 weeks to 26 June 2004
Before Exceptional Total
exceptional items
items (note 4)
Notes GBPm GBPm GBPm
(unaudited) (unaudited) (unaudited)
Turnover
Food 166.1 -- 166.1
Equipment
Property 0.8 -- 0.8
Total 2 166.9 -- 166.9
turnover
Operating
profit/(loss)
before
goodwill
amortisation
Food 18.5 -- 18.5
Equipment
Property (0.8) -- (0.8)
Corporate (2.2) -- (2.2)
costs
15.5 -- 15.5
Goodwill (3.0) -- (3.0)
amortisation
Operating 3 12.5 -- 12.5
profit/(loss)
Profit/(loss) -- -- --
on disposal 4
of businesses
Profit/(loss) 12.5 --
on ordinary 12.5
activities
before
interest and
taxation
Net interest (4.0) --
payable and (4.0)
similar
charges
Profit/(loss) 8.5 -- 8.5
on ordinary
activities
before
taxation
Tax on (2.0) -- (2.0)
profit/(loss)
on ordinary
activities
Profit/(loss) 6.5 -- 6.5
on ordinary
activities
after
taxation
Equity -- -- --
minority
interest
Retained 6.5 -- 6.5
profit/(loss)
Earnings/(loss) 6 Pence
per share
(pence)
(unaudited)
Basic 1.6
earnings/(loss)
per share
Adjusted 2.4
basic
earnings/(loss)
per share
Diluted 1.6
earnings/(loss)
per share
Adjusted 2.4
diluted
earnings/(loss)
per share
13 weeks to 28 June 2003
Before Exceptional Total
exceptional items
items (note 4)
Notes GBPm GBPm GBPm
(unaudited) (unaudited) (unaudited)
Turnover
Food Equipment 171.7 -- 171.7
Property -- -- --
Total turnover 2 171.7 -- 171.7
Operating
profit/(loss)
before
goodwill
amortisation
Food Equipment 18.6 (0.3) 18.3
Property -- -- --
Corporate (2.1) (0.9) (3.0)
costs
16.5 (1.2) 15.3
Goodwill (3.4) -- (3.4)
amortisation
Operating 3 13.1 (1.2) 11.9
profit/(loss)
Profit/(loss) 4 -- -- --
on disposal of
businesses
Profit/(loss) 13.1 (1.2) 11.9
on ordinary
activities
before
interest and
taxation
Net interest (5.2) -- (5.2)
payable and
similar
charges
Profit/(loss) 7.9 (1.2) 6.7
on ordinary
activities
before
taxation
Tax on (1.9) -- (1.9)
profit/(loss)
on ordinary
activities
Profit/(loss) 6.0 (1.2) 4.8
on ordinary
activities
after taxation
Equity -- -- --
minority
interest
Retained 6.0 (1.2) 4.8
profit/(loss)
Earnings/(loss) 6 Pence
per share
(pence)
(unaudited)
Basic 1.2
earnings/(loss)
per share
Adjusted basic 2.4
earnings/(loss)
per share
Diluted 1.2
earnings/(loss)
per share
Adjusted 2.4
diluted
earnings/(loss)
per share
Group statement 13 weeks to 13 weeks to
of total 26 June 28 June
recognised gains 2004 2003
and losses GBPm GBPm
(unaudited) (unaudited)
Retained 6.5 4.8
profit/(loss)
Currency translation
differences on foreign (1.1) (2.8)
currency net investments
Total recognised 5.4 2.0
gains and losses
for the period
Group profit and loss account
52 weeks to 27 September 2003
52 weeks to 27 September 2003
Before Exceptional Total
exceptional items
items (note 4)
Notes GBPm GBPm GBPm
Turnover
Food Equipment 663.7 -- 663.7
Property 15.7 -- 15.7
2 679.4 -- 679.4
Operating
profit/(loss)
before goodwill
amortisation
Food Equipment 64.9 (4.7) 60.2
Property 5.4 (3.3) 2.1
Corporate costs (9.5) (4.5) (14.0)
60.8 (12.5) 48.3
Goodwill amortisation (13.8) -- (13.8)
Operating 3 47.0 (12.5) 34.5
profit/(loss)
Profit/(loss) on 4 -- 3.3 3.3
disposal of
businesses
Profit/(loss) on 47.0 (9.2) 37.8
ordinary
activities before
interest and
taxation
Net interest (21.9) -- (21.9)
payable and
similar charges
Profit/(loss) on 25.1 (9.2) 15.9
ordinary
activities before
taxation
Tax on 5 (8.2) 1.8 (6.4)
profit/(loss) on
ordinary
activities
Profit/(loss) on 16.9 (7.4) 9.5
ordinary
activities after
taxation
Equity minority (0.1) -- (0.1)
interests
Retained 16.8 (7.4) 9.4
profit/(loss)
Earnings per share 6 pence
(pence)
Basic earnings per 2.4
share
Adjusted basic 7.7
earnings per share
Diluted 2.4
earnings per
share
Adjusted diluted 7.7
earnings per share
52 weeks to
27 September
2003
Group statement of total recognised gains and GBPm
losses
Retained profit/(loss) for the period 9.4
Currency translation differences on foreign (4.6)
currency net investments
Total recognised gains and (losses) for the 4.8
period
Group balance sheet
26 June 28 June 27 September
2004 2003 2003
GBPm GBPm GBPm
(unaudited) (unaudited)
(restated note (restated
1) note 1)
Fixed assets
Intangible 182.9 213.3 208.8
assets: Goodwill
Tangible assets 74.1 80.3 81.6
Investments 3.9 4.9 4.0
260.9 298.5 294.4
Current assets
Stocks 81.3 82.7 75.2
Debtors 113.1 117.4 118.3
Deferred tax 21.7 23.8 23.8
asset
Cash at bank and 48.2 56.3 77.7
in hand
264.3 280.2 295.0
Creditors falling
due within one
year
Borrowings (20.5) (40.7) (49.3)
Other creditors (165.6) (160.7) (174.6)
(186.1) (201.4) (223.9)
Net current assets 78.2 78.8 71.1
Total assets less 339.1 377.3 365.5
current
liabilities
Financed by:
Creditors falling
due after more
than one year
Borrowings 139.9 180.9 160.2
Provisions for 38.0 43.1 44.6
liabilities and
charges
177.9 224.0 204.8
Capital and
reserves
Called up equity 200.5 200.2 200.2
share capital
Share premium 234.3 234.2 234.2
account
Profit and loss (271.4) (278.7) (271.4)
account
ESOP Trust (2.4) (2.4) (2.4)
Equity 161.0 153.3 160.6
shareholders'
funds
Equity minority 0.2 -- 0.1
interests
339.1 377.3 365.5
Group cash flow statement
39 weeks to 39 weeks to 52 weeks to
26 June 28 June 27 September
2004 2003 2003
Notes GBPm GBPm GBPm
(unaudited) (unaudited)
Net cash flow
from operations 35.8 35.8 80.0
before
exceptional items
Net cash flow -- (4.4) (6.5)
effect of
exceptional items
Net cash (a) 35.8 31.4 73.5
inflow/(outflow)
from operating
activities
Return on
investments and
servicing of
finance
Interest paid (14.3) (16.8) (18.9)
Taxation
Overseas and UK (4.2) (6.0) (7.1)
tax paid
Capital
expenditure and
financial
investment
Payments to (8.0) (4.9) (10.0)
acquire tangible
fixed assets
Receipts from 0.1 0.5 0.6
sale of tangible
fixed assets
(7.9) (4.4) (9.4)
Acquisitions and
disposals
Disposal of -- (1.3) (1.3)
subsidiary
undertakings
Cash 9.4 2.9 36.8
inflow/(outflow)
before financing
Financing
Issue of share 0.4 -- --
capital
Net increase/(decrease) (37.5) (20.2) (32.3)
in term loans and other
borrowings
Capital element of -- (0.3) (0.2)
finance lease payments
(37.1) (20.5) (32.5)
Increase/(decrease) in (27.7) (17.6) 4.3
cash in the period
Notes to the group cash flow statement
(a) Reconciliation of operating profit/(loss) to net cash
inflow/(outflow) from operating activities
39 weeks to 26 June 2004
Before Effect of Total
exceptional exceptional
items items
GBPm GBPm GBPm
(unaudited) (unaudited) (unaudited)
Operating 26.3 -- 26.3
profit/(loss)
Depreciation 8.8 -- 8.8
Amortisation of 9.0 -- 9.0
goodwill
Increase/(decrease) (3.3) -- (3.3)
in provisions
(Increase)/decrease (10.7) -- (10.7)
in stock
(Increase)/decrease (1.6) -- (1.6)
in debtors
Increase/(decrease) 7.3 -- 7.3
in creditors
Net cash
inflow/(outflow) 35.8 -- 35.8
from operating
activities
39 weeks to 28 June 2003
Before Effect of
exceptional exceptional
items items Total
GBPm GBPm GBPm
(unaudited) (unaudited) (unaudited)
Operating 25.8 (7.2) 18.6
profit/(loss)
Depreciation 9.2 -- 9.2
Amortisation of 10.2 -- 10.2
goodwill
Increase/(decrease) (2.2) 2.3 0.1
in provisions
(Increase)/decrease (5.0) -- (5.0)
in stock
(Increase)/decrease 9.3 -- 9.3
in debtors
Increase/(decrease) (11.5) 0.5 (11.0)
in creditors
Net cash
inflow/(outflow) 35.8 (4.4) 31.4
from operating
activities
52 weeks to 27 September 2003
Before Effect of Total
exceptional exceptional
items items
GBPm GBPm GBPm
Operating profit/(loss) 47.0 (12.5) 34.5
Depreciation 12.4 -- 12.4
Amortisation of 13.8 -- 13.8
goodwill
Increase/(decrease) in (2.8) 4.5 1.7
provisions
(Increase)/decrease in 2.6 -- 2.6
stock
(Increase)/decrease in 7.5 -- 7.5
debtors
Increase/(decrease) in (0.5) 1.5 1.0
creditors
Net cash 80.0 (6.5) 73.5
inflow/(outflow) from
operating activities
(b) Reconciliation of net cash flow to movement in net debt
26 June 28 June 27 September
2004 2003 2003
GBPm GBPm GBPm
(unaudited) (unaudited)
Net debt at the start (139.7) (186.1) (186.1)
of period
Increase/(decrease) (27.7) (17.6) 4.3
in net cash in the
period
Net 37.5 20.5 32.5
(increase)/decrease
in other loans
Translation 11.1 9.2 9.6
differences
Net debt at the end (118.8) (174.0) (139.7)
of the period
(c) Reconciliation of net debt to balance sheet
26 June 28 June 27 September
2004 2003 2003
GBPm GBPm GBPm
(unaudited) (unaudited)
Cash at bank and in 48.2 56.3 77.7
hand
Short term (20.5) (40.7) (49.3)
borrowing
Long term borrowing (139.9) (180.9) (160.2)
(112.2) (165.3) (131.8)
Exclude deferred (6.6) (8.7) (7.9)
financing costs
(118.8) (174.0) (139.7)
Notes to the financial statements
1. Basis of Preparation
The accompanying condensed consolidated financial statements ("quarterly financial statements") have been prepared in accordance with accounting principles generally accepted in the United Kingdom ("UK GAAP"). The quarterly financial statements are unaudited but include all adjustments which management considers necessary for a fair presentation of the financial position of the Group (Enodis plc and subsidiary undertakings) for the 13 and 39 week periods ended 26 June 2004 and 28 June 2003 and the operating results and cash flows for the periods. Certain information and footnote disclosures normally included in statutory financial statements prepared in accordance with UK GAAP have been condensed or omitted. The results of operations for the 39 weeks ended 26 June 2004 may not necessarily be indicative of the operating results that may be achieved for the 53 week period ending 2 October 2004.
The quarterly financial statements have been prepared on the basis of the accounting policies set out in the Group's financial statements for the period ended 27 September 2003, other than as noted below in respect of UITF Abstract 38 "Accounting for ESOP Trusts" ("UITF38").
During Q104, the Group adopted UITF38. Consequently the impairments booked against the Group's investment in own shares of GBP1.1m and GBP0.3m in FY01 and FY02 respectively, have been reversed and recorded in the profit and loss reserve. The original cost of investment has been reclassified from fixed asset investments to being a deduction in equity shareholders' funds. Comparative periods have been restated to reflect this accounting treatment. The Group's ESOP Trust holds 1,269,341 ordinary shares of Enodis plc at a cost of GBP2.4m. At 26 June 2004, the market value of the shares was GBP1.2m.
UK GAAP differs in certain significant respects from accounting principles generally accepted in the United States of America ("US GAAP"). The application of the latter would have affected the determination of profit/(loss) to the extent summarised in Note 9 to the quarterly financial statements.
These quarterly financial statements should be read in conjunction with the financial statements and the notes thereto included in the Group's latest Annual Report.
The accounts in this statement do not comprise full accounts within the meaning of section 240 of the Companies Act 1985. The figures for the 52 weeks to 27 September 2003 are based upon the 2003 Annual Report but do not comprise statutory accounts for that period. The audited financial statements have been delivered to the Registrar of Companies following approval at the Annual General Meeting of the Company on 11 February 2004. The Auditors made an unqualified report on those accounts and their report did not contain any statement under section 237 (2) or (3) of the Companies Act 1985. The figures for the 13 and 39 week periods to 26 June 2004 and 28 June 2003 have been extracted from underlying accounting records and have not been audited.
2. Turnover
39 weeks to 39 weeks to
26 June 28 June
2004 2003
GBPm GBPm
(unaudited) (unaudited)
Food Service Equipment -- North
America 280.4 299.4
Food Service Equipment -- 106.7 104.7
Europe/Asia
Global Food Service Equipment 387.1 404.1
Food Retail Equipment 69.5 78.5
Food Equipment 456.6 482.6
Property 1.1 --
457.7 482.6
13 weeks to 13 weeks to 52 weeks to
26 June 28 June 27 September
2004 2003 2003
GBPm GBPm GBPm
(unaudited) (unaudited)
Food Service
Equipment -- North 101.1 103.1 408.4
America
Food Service 39.0 38.8 144.5
Equipment --
Europe/Asia
Global Food Service 140.1 141.9 552.9
Equipment
Food Retail 26.0 29.8 110.8
Equipment
Food Equipment 166.1 171.7 663.7
Property 0.8 -- 15.7
166.9 171.7 679.4
Notes to the financial statements (continued)
3. Operating profit/(loss)
39 weeks to 26 June 2004
Before Total
exceptional Exceptional
items items
GBPm GBPm GBPm
(unaudited) (unaudited) (unaudited)
Food Service --
Equipment 34.4 34.4
-- North America
Food Service --
Equipment 5.0 5.0
-- Europe/Asia
Global Food --
Service 39.4 39.4
Equipment
Food Retail 4.2 -- 4.2
Equipment
43.6 -- 43.6
Food Equipment --
goodwill (9.0) (9.0)
amortisation
Food Equipment 34.6 -- 34.6
Property (1.7) -- (1.7)
Corporate costs (6.6) -- (6.6)
26.3 -- 26.3
39 weeks to 28 June 2003
Before
exceptional Exceptional
items items Total
GBPm GBPm GBPm
(unaudited) (unaudited) (unaudited)
Food Service 33.4 (1.7) 31.7
Equipment
-- North America
Food Service 6.9 (0.2) 6.7
Equipment
-- Europe/Asia
Global Food 40.3 (1.9) 38.4
Service
Equipment
Food Retail 1.9 -- 1.9
Equipment
42.2 (1.9) 40.3
Food Equipment (10.2) -- (10.2)
goodwill
amortisation
Food Equipment 32.0 (1.9) 30.1
Property -- (2.5) (2.5)
Corporate costs (6.2) (2.8) (9.0)
25.8 (7.2) 18.6
13 weeks to 26 June 2004
Before Total
exceptional Exceptional
items items
GBPm GBPm GBPm
(unaudited) (unaudited) (unaudited)
Food Service 14.1 -- 14.1
Equipment
-- North America
Food Service 2.6 -- 2.6
Equipment
-- Europe/Asia
Global Food 16.7 -- 16.7
Service
Equipment
Food Retail 1.8 -- 1.8
Equipment
18.5 -- 18.5
Food Equipment (3.0) -- (3.0)
goodwill
amortisation
Food Equipment 15.5 -- 15.5
Property (0.8) -- (0.8)
Corporate costs (2.2) -- (2.2)
12.5 -- 12.5
13 weeks to 28 June 2003
Before
exceptional Exceptional
items items Total
GBPm GBPm GBPm
(unaudited) (unaudited) (unaudited)
Food Service 13.3 (0.3) 13.0
Equipment
-- North America
Food Service 3.3 -- 3.3
Equipment
-- Europe/Asia
Global Food 16.6 (0.3) 16.3
Service
Equipment
Food Retail 2.0 -- 2.0
Equipment
18.6 (0.3) 18.3
Food Equipment (3.4) -- (3.4)
goodwill
amortisation
Food Equipment 15.2 (0.3) 14.9
Property -- -- --
Corporate costs (2.1) (0.9) (3.0)
13.1 (1.2) 11.9
52 weeks to 27 September 2003
Before exceptional Total
items Exceptional
Items
GBPm GBPm GBPm
Food Service Equipment -- North 50.7 (3.0) 47.7
America
Food Service Equipment -- 10.2 (1.7) 8.5
Europe/Asia
Global Food Service Equipment 60.9 (4.7) 56.2
Food Retail Equipment 4.0 -- 4.0
64.9 (4.7) 60.2
Food Equipment goodwill (13.8) -- (13.8)
amortisation
Food Equipment 51.1 (4.7) 46.4
Property 5.4 (3.3) 2.1
Corporate costs (9.5) (4.5) (14.0)
47.0 (12.5) 34.5
Notes to the financial statements (continued)
4. Exceptional items
(a) Operating 39 weeks to 39 weeks to 52 weeks to
exceptional items 26 June 28 June 27 September
2004 2003 2003
GBPm GBPm GBPm
(unaudited) (unaudited)
Restructuring -- 3.0 6.1
costs and cost
reduction measures
Vacant leasehold -- 2.5 3.3
provisions
Litigation costs -- 1.7 3.1
Operating -- 7.2 12.5
exceptional items
2003
On 8 April 2003, the Group announced a restructuring and cost reduction programme including salaried headcount reduction and the relocation of the CEO's office to Tampa, Florida. Subsequently, further restructuring programmes were announced in Europe.
In addition, as a result of a slowdown in the property market, GBP3.3m was recognised in respect of vacant leasehold properties.
During 2003, the Group reassessed its accruals for legal costs for defending the claims in the Consolidated Industries litigation following an adverse summary judgement on certain of the claims totalling $8.6m, and provided GBP1.7m and GBP1.4m in Q103 and Q403 respectively. The Group continues to believe that the adverse decision is incorrect, and intends to appeal the decision. The Group's view of the outcome of the Consolidated Industries litigation remains unchanged.
(b) Disposal of 39 weeks to 39 weeks to 52 weeks to
businesses 26 June 28 June 27 September
2004 2003 2003
GBPm GBPm GBPm
(unaudited) (unaudited)
Profit/(loss) on 2.2 2.5 3.3
disposals
2004
In November 2003 and in April 2004 respectively, the majority of warranties and indemnities that the Group gave at the time of the disposals of two of its subsidiaries expired. As a result, excess provisions of GBP0.9m and GBP1.3m have been credited to the profit and loss account in Q104 and Q204 respectively.
2003
In February 2003, the Group paid GBP1.3m to release it from the majority of the warranties and indemnities that were given at the time of the disposal of one of its subsidiaries. As a result, excess accruals of GBP2.5m, along with GBP0.8m from other disposals, were credited to the profit and loss account in Q103 and Q403 respectively.
Notes to the financial statements (continued)
5. Taxation
(a) Analysis of 39 weeks to 39 weeks to 52 weeks to
charge in period 26 June 28 June 27 September
2004 2003 2003
GBPm GBPm GBPm
(unaudited) (unaudited)
The tax charge for
the current period
comprised:
UK taxation at 30% -- -- --
(2003:30%)
Foreign
taxation
-- current year 3.9 3.3 7.4
-- prior year -- -- (0.7)
3.9 3.3 6.7
Deferred taxation -- -- 1.5
3.9 3.3 8.2
Tax relief on -- -- (1.8)
exceptional items
3.9 3.3 6.4
(b) The Group tax rate benefits from the effect of tax losses brought forward. A current tax charge arises principally because of profits arising in overseas countries where there are no available losses.
6. Earnings/(loss) per share
39 weeks 39 weeks 13 weeks 13 weeks 52 Weeks
to to to to to
26 June 28 June 26 June 28 June 27
September
2004 2003 2004 2003 2003
GBPm GBPm GBPm GBPm GBPm
(unaudit (unaudit (unaudited) (unaudited)
ed) ed)
Retained
profit/(loss) 11.7 1.4 6.5 4.8 9.4
attributable
to
shareholders
m m m m m
Basic 399.5 399.2 399.8 399.2 399.2
weighted
average
number of
shares
Dilutive
number of 2.1 -- 2.5 -- --
shares
from
executive
share
option
schemes
Diluted 401.6 399.2 402.3 399.2 399.2
weighted
average
number of
shares
39 weeks 39 weeks 13 weeks 13 weeks 52 weeks
to to to to to
26 June 28 June 26 June 28 June 27
September
2004 2003 2004 2003 2003
Pence pence pence pence pence
(unaudited)(unaudited)(unaudited)(unaudited)
Basic 3.0 0.4 1.6 1.2 2.4
earnings/
(loss) per
share
Effect per (0.6) 1.2 -- 0.3 1.8
share of
exceptional
items
Effect per 2.2 2.5 0.8 0.9 3.5
share of
goodwill
amortisation
Adjusted 4.6 4.1 2.4 2.4 7.7
basic
earnings/(loss)
per
share
Diluted 3.0 0.4 1.6 1.2 2.4
earnings/
(loss) per
share
Effect per (0.6) 1.2 -- 0.3 1.8
share of
exceptional
items
Effect per 2.2 2.5 0.8 0.9 3.5
share of goodwill
amortisation
Adjusted diluted 4.6 4.1 2.4 2.4 7.7
earnings/(loss)
per share
Adjusted earnings per share before exceptional items (note 4) and goodwill amortisation are disclosed to reflect the underlying performance of the Group.
Notes to the financial statements (continued)
7. Foreign currency translation
The results of subsidiary companies reporting in currencies other than pounds sterling, principally US dollars, have been translated at the following rates:
39 weeks to 39 weeks to
26 June 28 June
2004 2003
(unaudited) (unaudited)
Average exchange rate GBP1= US$ 1.78 1.60
Closing exchange rate GBP1 =US$ 1.82 1.65
13 weeks to 13 weeks to 52 weeks to
26 June 28 June 27 September
2004 2003 2003
(unaudited) (unaudited)
Average exchange 1.81 1.62 1.60
rate GBP1= US$
Closing exchange 1.82 1.65 1.66
rate GBP1 =US$
8. Contingencies
As we have previously discussed, Enodis Corporation and several other parties have been named in a lawsuit filed in the United States Bankruptcy Court for the Northern District of Indiana, Freeland v. Enodis, et al. In the case, the bankruptcy trustee sought to hold Enodis Corporation liable as the "alter ego" of its former subsidiary Consolidated Industries Corporation, for the debts and other liabilities of Consolidated. Enodis Corporation sold Consolidated to an unrelated party in 1998. Shortly after the sale, Consolidated commenced bankruptcy proceedings. In addition to the "alter ego" claim, the trustee asserted a variety of bankruptcy and equitable claims seeking to recover up to $30m paid by Consolidated to Enodis Group between 1988 and 1998. On 28 July 2004, the Bankruptcy Court issued an opinion dismissing all claims against all defendants other than Enodis Corporation, and holding that the trustee was not entitled to assert the alter ego claims against Enodis Corporation. However, the Court also held that the trustee was entitled to recover the $30m paid by Consolidated, plus prejudgment interest, for a total of approximately $43m. This judgment is in addition to the summary judgment issued by the United States District Court for the Northern District of Indiana previously discussed in our 2003 Annual Report in the amount of approximately $8.6 million. Enodis Group, having considered the advice from its external legal counsel, believes the adverse portion of the decision of the Bankruptcy Court and the decision of the District Court to be in error and plans to appeal both decisions.
Notes to the financial statements (continued)
9. Supplementary information for US Investors
Reconciliation to generally accepted accounting principles in the United States of America
The consolidated financial statements have been prepared in accordance with UK GAAP, which differs from US GAAP. The following is a summary of adjustments to operating profit/(loss) and retained profit/(loss) for the period required when reconciling such amounts recorded in the consolidated financial statements to the corresponding amounts in accordance with US GAAP. This note does not include all disclosures required by US GAAP.
39 weeks to 39 weeks to 52 weeks to
26 June 28 June 27
September
2004 2003 2003
GBPm GBPm GBPm
(unaudited) (unaudited)
(restated)
Retained profit/(loss) 11.7 1.4 9.4
in accordance with UK
GAAP
Items
increasing/(decreasing)
UK GAAP operating
profit/(loss)(*):
-- Goodwill 9.0 10.2 13.5
amortisation
-- Pension costs (0.3) (1.5) 2.2
-- Leasing transactions (0.1) -- (0.1)
-- Share option plans -- -- 0.1
-- Restructuring (0.8) -- 0.8
charges
-- Derivative -- 0.1 0.1
instruments
-- Long-lived assets -- -- (0.5)
-- Loss contingencies (1.6) -- 1.8
-- Other 0.8 -- --
Items
increasing/(decreasing)
UK GAAP non-operating
profit/(loss):
-- Deferred taxation (5.7) (2.6) (36.9)
-- Capitalised interest 0.6 0.3 0.4
Retained profit/(loss) 13.6 7.9 (9.2)
in accordance with US
GAAP before cumulative
effect of change in
accounting principle
Cumulative effect of -- (84.9) (84.9)
change in accounting
principle
Retained profit/(loss) 13.6 (77.0) (94.1)
in accordance with US
GAAP
Retained profit/(loss)
in accordance
with US GAAP is
represented by:
Net profit/(loss) 11.4 5.4 (11.7)
from continuing
operations
Gain on sale of 2.2 2.5 2.5
discontinued
operations
Cumulative effect of -- (84.9) (84.9)
change in
accounting principle
Retained profit/(loss) 13.6 (77.0) (94.1)
in accordance
with US GAAP
(*) All adjustments exclude the effect of taxes, with all tax related adjustments included within the deferred taxation line item.
Description of differences
A discussion of the material variations in the accounting principles, practices and methods used in preparing the audited consolidated financial statements in accordance with UK GAAP from the principles, practices and methods generally accepted in the United States of America is provided in our Annual Report at 27 September 2003. Other than our adoption of UITF 38 (See Note 1), there have been no new material variations between UK GAAP and US GAAP accounting principles, practices and methods used in preparing these consolidated financial statements.
Adoption of new accounting standards
Effective from 29 September 2002, under US GAAP, the Group adopted the provisions of Statement of Financial Accounting Standards No. 142, "Goodwill and Other Intangible Assets" ("SFAS 142"). In accordance with SFAS 142, goodwill is no longer amortised but instead is subject to a transitional impairment test in the year of adoption as well as annual impairment tests. Using discounted cash flow valuation methods and also considering the Group's market capitalisation, the Group reviewed the fair values of each of its reporting units. As a result of the transitional impairment test, the Group recorded a goodwill impairment charge of GBP84.9 million in its Global Food Service Equipment segment. The amount was calculated in the fourth quarter of Fiscal 2003 and recorded as a cumulative effective of a change in accounting principle as at 29 September 2002, as required under SFAS 142.
Other unaudited financial information
(i) Reconciliation of like-for-like information for the 39 weeks to 26 June 2004
39 weeks to 39 weeks to
26 June 28 June
2004 2003
a) Turnover GBPm GBPm
Food Service Equipment
-- North America 280.4 299.4
Food Service Equipment
-- Europe/Asia 106.7 104.7
Global Food Service Equipment 387.1 404.1
Food Retail Equipment 69.5 78.5
Food Equipment 456.6 482.6
b) Operating profit before
exceptional items, goodwill
amortisation, property and
corporate costs
Food Service Equipment
-- North America 34.4 33.4
Food Service Equipment
-- Europe/Asia 5.0 6.9
Global Food Service Equipment 39.4 40.3
Food Retail Equipment 4.2 1.9
Food Equipment 43.6 42.2
Effect of Like-for-like Like-for-like
Foreign 28 June increase/
Exchange 2003 (decrease)
a) Turnover GBPm GBPm %
Food Service
Equipment (28.2) 271.2 3%
-- North America
Food Service
Equipment 0.5 105.2 1%
-- Europe/Asia
Global Food (27.7) 376.4 3%
Service
Equipment
Food Retail (7.8) 70.7 (2%)
Equipment
Food Equipment (35.5) 447.1 2%
b) Operating
profit before
exceptional
items, goodwill
amortisation,
property and
corporate costs
Food Service
Equipment (3.2) 30.2 14%
-- North America
Food Service
Equipment (0.0) 6.9 (28%)
-- Europe/Asia
Global Food (3.2) 37.1 6%
Service
Equipment
Food Retail (0.2) 1.7 147%
Equipment
Food Equipment (3.4) 38.8 12%
(ii) Reconciliation of like-for-like information for the 13
weeks to 26 June 2004
13 weeks to 13 weeks to
26 June 28 June
2004 2003
a) Turnover GBPm GBPm
Food Service Equipment
-- North America 101.1 103.1
Food Service Equipment
-- Europe/Asia 39.0 38.8
Global Food Service Equipment 140.1 141.9
Food Retail Equipment 26.0 29.8
Food Equipment 166.1 171.7
b) Operating profit before
exceptional items, goodwill
amortisation, property and
corporate costs
Food Service Equipment
-- North America 14.1 13.3
Food Service Equipment
-- Europe/Asia 2.6 3.3
Global Food Service Equipment
16.7 16.6
Food Retail Equipment 1.8 2.0
Food Equipment 18.5 18.6
Effect of Like-for-like Like-for-like
Foreign 28 June increase/
Exchange 2003 (decrease)
a) Turnover GBPm GBPm %
Food Service
Equipment (10.4) 92.7 9%
-- North America
Food Service
Equipment (1.3) 37.5 4%
-- Europe/Asia
Global Food (11.7) 130.2 8%
Service
Equipment
Food Retail (3.2) 26.6 (2%)
Equipment
Food Equipment (14.9) 156.8 6%
b) Operating
profit before
exceptional
items, goodwill
amortisation,
property and
corporate costs
Food Service
Equipment (1.4) 11.9 18%
-- North America
Food Service
Equipment (0.1) 3.2 (19%)
-- Europe/Asia
Global Food
Service (1.5) 15.1 11%
Equipment
Food Retail (0.2) 1.8 --
Equipment
Food Equipment (1.7) 16.9 9%
Other unaudited financial information (continued)
(iii) Reconciliation of non-UK GAAP measures
39 weeks to 39 weeks to
26 June 28 June
2004 2003
GBPm GBPm
a) Adjusted operating profit/(loss)
Operating profit/(loss) 26.3 18.6
Add back:
Goodwill amortisation 9.0 10.2
Exceptional profit/(loss) -- 7.2
Adjusted operating profit/(loss) 35.3 36.0
b) Adjusted profit/(loss) before
tax
Profit/(loss) before tax 15.7 4.7
Add back:
Goodwill amortisation 9.0 10.2
Exceptional profit/(loss) (2.2) 4.7
Adjusted Profit/(loss) before tax 22.5 19.6
13 weeks to 13 weeks to 52 weeks to
26 June 28 June 27 September
2004 2003 2003
GBPm GBPm GBPm
a) Adjusted operating
profit/(loss)
Operating 12.5 11.9 34.5
profit/(loss)
Add back:
Goodwill amortisation 3.0 3.4 13.8
Exceptional -- 1.2 12.5
profit/(loss)
Adjusted operating 15.5 16.5 60.8
profit/(loss)
b) Adjusted
profit/(loss) before
tax
Profit/(loss) before 8.5 6.7 15.9
tax
Add back:
Goodwill amortisation 3.0 3.4 13.8
Exceptional -- 1.2 9.2
profit/(loss)
Adjusted 11.5 11.3 38.9
Profit/(loss) before
tax
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